Incremental SUC must be applicable only on band shared among telcos: Trai

Incremental spectrum usage charges should be applicable only on frequency bands that are shared among telecom operators and not on the entire radiowaves held by them, telecom regulator Trai reiterated its recommendation on Tuesday.

The Department of Telecom had earlier asked the Telecom Regulatory Authority of India to reconsider its recommendation that an increment of 0.5 per cent on the SUC rate should apply to the spectrum holding in a specific band in which sharing is taking place, and not on the entire spectrum holding (all bands) of the telecom operator.

"The Authority concurs with the views of the stakeholders that in case incremental SUC is made applicable on an overall weighted average, the cost of spectrum sharing could surpass the benefits achieved by the TSPs.

"Moreover, there is no rationale in incrementing overall weighted average SUC, post sharing of spectrum in a specific band(s)," Trai said in its reply to the DoT.

At present, telecom operators use various spectrum bands like 700 Mhz band, 800 Mhz band, 900 Mhz band, 1,800 Mhz band, 2100 Mhz band and so on for providing mobile services.

Telecom operators share frequencies among themselves to meet network requirements based on factors like customer density in an area, utilisation level etc.

Telecom operators are charged around 3 per cent of their adjusted gross revenue (AGR) as SUC.

In the quarter ended September 2022, mobile service providers paid SUC of Rs 1,398 crore on AGR of about Rs 60,637 crore.

The matter of calculating SUC for spectrum sharing was initiated by the DoT in January 2020 after it received representation from the industry, requesting to levy an incremental SUC of 0.5 per cent on the spectrum band that they are sharing.

"The Authority has considered the backreference dated January 27, 2023, of the government. In the absence of any new facts and considering the above discussion, the Authority has nothing to add further," Trai said.